Asked on 07 Aug 2018
Thanks for your replies and contributions.
I have been thinking about the buying term for CI and then save-invest (self insured) for the remaining years.
Insurance is all about "what ifs" and taking care of the dependents. The ultimate objective for me is not to burden my son in 20+ years later.
Financially, i am ok for now. No car, no maid, HDB, 1 kid.
@Jonny / Hariz: I'm very new to this forum; i dont even know where's the option for PM. How about you drop me a message? I'm always open to hear more views.
Can i suggest another alternative? Buy term if you have limited budget. Par fund returns are not guarenteed and why not buy plain-old vanilla when you may not have the expertise in understanding the different product type and stuffs.
There are many standalone Multipay CI/Early CI plan in the market now. You may PM me or drop me an mail. I would be glad to assist in-regardless of your budget.
with only an odd 20 years upon reaching 65, between getting coverage and term insurance, I would strongly suggest to go through the following:
1) Understand your coverage
2) Compare the cost of insurance and self-insured
3) May want to consider getting half half or even 5 years term insurance, and then self-insured all the way
4) compare it to a whole life
Cannot exactly advise as the ECI (early critical cover) cost itself (and peace of mind) is hard to balance, as at your age, the cost of insurance is a lot higher (like 4X higher than when you are young) at 25/30, which explains why i strongly suggest maybe to consider self-insurance instead...
Hi Anon, it's good that you're considering getting yourself for unforseen circumstances and protecting your income.
However a few pointers:
Firstly, when someone mentions 'worth', they have to consider "compared to what?"
Is there any other option for you to get early CI coverage for life without paying for life? No. This is your only choice.
What you can consider is getting term till retirement, and self funding your own "Early CI coverage" through savings or investment.
Or a mixture of both. Some whole life, some term, some savings for a self insured account.
So again, what are you comparing to?
I work exclusively with Singaporeans in their 40s so if you want my personal advice, I'll be a message away.
You need to determine your coverage adequacy and affordability.
using the word "cover" is very vague. 10c coverage also considered as "cover"
You can consider AIA Gauranteed Protect Plus II, this plan has limited pay term option 12/20/65/75. With 12 pay, you will have completed your payment by 52 years old and the coverage for CI is either 65 / 75 depending on your choice. It is a whole life plan that has an option to add Early Critical Illness rider as well. Upon claim of early critical illness, the sum assured for the basic plan will not change.
If you prefer a plan that covers early, intermediate and major illness with reset of coverage 12/24 months and can claim up to 5x of the coverage and covers up to 100 years old, you can consider Power Critical Cover. This is a CI plan that has cash value upon surrender of policy from the age of 75 years old.
I think it depends on how much coverage you need.
If you don't need too much coverage, e.g. less than $200k payout, then taking Whole Life insurance @ 40yo is ok, it's more expensive compared to taking it at 20yo but it's still affordable. And if you can stretch your budget nowadays people pay 10years only and they're covered the whole life (until 99yo).
However, if you need high payout, e.g. more than $500k, perhaps due to family committments and etc, then getting a term CI plan makes more sense (cheaper). However it's pay-as-you-cover so you'll have to decide until when you want to be covered.
Can run through these questions with your FC/FA. And of course must have hospital plan first because that'll take care of the bills!
Depending on your finances and your income ability, you might want to do some comparisons between whole life + early CI or term life + CI covers.
Whole life + CI at 40 will definitely be alot more expensive but everyone has different needs and income earning ability.